Government deficit at £17million

Treasury Minister Eddie Teare says the government deficit is lower than expected - but warns this is 'no excuse to relax'.

Ahead of publication of the government accounts next Tuesday, Mr Teare has announced today that, at £17million, the deficit for the year ending March 31 2014 is £14million lower than estimated.

Income was higher than forecast, boosted by additional income tax receipts of £5million, while departmental underspending brought expenditure in below estimate. The government workforce has been cut by more than 700 over the past four years.

Mr Teare said the outcome was 'encouraging' but added: 'Government is well on course to rebalance the budget in the 2015/16 financial year, but that does not mean we are out of the woods. Government’s internal reserves need to be rebuilt, cost pressures will continue, and most importantly we still do not know exactly what the Island’s share of VAT revenue will be in the future.

'This latest update on Government’s financial position is a very welcome confirmation that we are delivering on our national priorities of rebalancing public finances, growing the economy and protecting the vulnerable. But knowing that challenges still lie ahead it is certainly no excuse to relax from the task of maintaining financial discipline, and indeed it would be politically irresponsible to do so.'